DALLAS--(BUSINESS WIRE)--EFG Companies, the innovator behind the award-winning Hyundai
Assurance program, today shared some of the top issues impacting the
future health of the retail automotive industry. During a State of the
Industry Address, President and CEO John Pappanastos encouraged
dealership principals and senior managers to quickly address staffing
and customer engagement models - or risk becoming a dinosaur in the
rapidly changing consumer car-buying model. To view the EFG State of the
Industry address, visithttp://bit.ly/2I58dNp.

Hiring Challenges Impede Growth

The 2017 National Automobile Dealers Association (NADA) Workforce Study
reported that retail automotive suffered from a 43 percent turnover rate
(up two points from 2016). The automotive industry experienced an 88
percent attrition rate among female new hires, and a below average rate
of millennial new hires when compared to other industries. Many retail
automotive businesses lack a comprehensive plan to become an employer of
choice, relying heavily on traditional “bell-to-bell” hours,
commission-only payment plans, and limited training. According to
Pappanastos, who recently received an honorary doctorate from Northwood
University, the only accredited Automotive Marketing and Management
program in the nation, dealerships must develop a strategic plan to
hire, train, and promote the best and brightest employees to operate in
a world where consumers are demanding a more digital buying process with
a higher level of customer experience.

Mike Wilson, the general manager of Nyle Maxwell Chrysler Jeep Dodge Ram
Supercenter, echoed those sentiments. “Many people do not realize all of
the possible careers within a dealership – accounting, human resources,
finance, marketing, etc.,” said Wilson, whose progressive Austin, TX
dealership boasts a low turnover rate. “My hiring criteria is the same
as any other business. I want professional self-starters who are great
in their field and are building a career.”

Turnover and failure to recruit high-performing professionals directly
impacts a dealership’s bottom line. For example, a single poor hiring
decision in F&I can easily result in up to $75,000 in lost profit due to
onboarding costs and lost production. The retail automotive industry’s
focus on daily operations also hampers leadership development and
obscures the growth path for Millennial hires who, as a group, require
opportunities for promotion.

Consumer Changes Demand New Skills

According to recent research from Cox Automotive, 80 percent of
consumers want to complete at least half of the car buying process
digitally. A 2018 Deloitte study showed that “dealers create a
fragmented and inconsistent approach to the customer” which leads to
inefficient customer contact, inconsistent messaging, and ultimately
failure to sell and build loyalty.

To address this paradigm shift in consumer engagement, EFG encourages
its clients to embrace digital – quickly. “While I realize change is
difficult, dealership principals must incorporate greater
consumer-facing digital platforms into their dealerships,” said
Pappanastos. “Failure to do so will result in lost revenue. We must
remember the old adage of ‘meet the customer where they are.’ And
today’s customer is clearly online.”

To facilitate this change, hire employees who are experts in online
customer engagement and digital sales approaches. “More than 90 percent
of our initial customer contact is online,” said Anthony Patterson,
owner and dealer principal of Patterson Auto Group, based out of Wichita
Falls, TX. “We are looking for people who are social media savvy – good
communicators – high multitaskers. Our sales people know that they may
not meet the buyer until they pick up their vehicle. Our customers
demand this type of engagement – and we've hired really smart people who
have pushed our dealership into this new realm.”

In addition, Pappanastos encouraged dealerships to not lose sight of
compliance. During a recent commencement address to the 2018 graduates
at Northwood University, he highlighted character, as well as skills.
“Job skills are easy to assess, what’s difficult is finding candidates
who have solid character,” Pappanastos commented. “During these
tumultuous times, dealerships must maintain a high degree of integrated
compliance. The resulting fines, and damage to reputation, can result in
significant business loss due to very clear and public online postings
and reviews.”

During his State of the Industry address, Pappanastos’ remarks focused
on the future health of the retail automotive industry and sounded a
wake-up call to dealership principals to quickly embrace changing
consumer buying preferences. With a nod to this year’s graduates, he
encouraged future Millennial and Gen Z employees to seek out careers in
retail automotive, noting the exciting changes, and their opportunity to
make industry-wide impact.

About EFG Companies

EFG Companies drives the industry’s highest-reported compliant F&I
profitability through its distinct engagement model in which the company
operates as an extension of the dealer’s management team. EFG addresses
total dealership performance, and its client satisfaction Net Promoter
score is higher than national corporate leaders such as Southwest
Airlines, USAA Banking and Finance, and Nordstrom. Learn more about EFG
at: www.efgcompanies.com.

Contacts

for EFG CompaniesMarcia Barnett, 214-868-8861

Release Summary

EFG Companies President and CEO John Pappanastos encourages retail automotive to change or risk becoming a dinosaur in the changing car buying model.